Inflation, Nominal GDP, And Real GDP

Trends of Unemployment, Inflation, Nominal GDP, and Real GDP
Unemployment refers to the total percentage of a country’s workforce that is unemployed and is looking for a paid job. The rate of unemployment is the percentage of the whole population that is actively seeking paid employment (Coyle 2). The ratio is reached at by dividing the number of jobless people by the already working individuals in the workforce. In statistics, a rising unemployment rate is an indicator of a weakening economy (Mankiw 16).On the other hand, a falling rate indicates that the economy is growing.
Inflation refers to the annual increase in the prices of goods and services in a nation. An increase in inflation causes a unit of money to buy less stuff while a reduction

It is the real value of goods and services without the changes due to inflation or deflation (Mankiw 39). The real gross domestic product reflects the real money value and the growth margin in a state’s economy.
Nominal gross domestic product refers to the value of GDP before accounting for the changes effected by inflation and deflation (Coyle 32). It shows the level of growth or shrinking of a country’s economy but does not put into consideration the consumer buying power. The value can be misleading to a nation because it does not reflect the real growth value of the economy.
A trend analysis of the unemployment rates, inflation, nominal GDP, and real GDP were tabulated and graphed as shown below. From the graphs, it is evident that inflation and unemployment rates have a non-deterministic curve and fluctuate over time. The progression occurs because inflation and unemployment can be caused by many other factors apart from the economic growth (Mankiw 58). For instance, changes in international market prices, advancements in technology, and the use of different methods of production.
Table 1: Showing trends of unemployment, nominal GDP, real GDP and